Ricky Ray v. State Farm Mutual Insurance

• Court: Court of Appeals for the Ninth Circuit
• Decided: October 21, 2021
• Docket: 20-55989
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS OCT 21 2021 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

RICKY RAY, individually and as successor No. 20-55989 in interest to Cynthia Ray, deceased; et al., D.C. No. Plaintiffs-Appellants, 2:19-cv-04922-DSF-MAA

v. MEMORANDUM* STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY,

Defendant-Appellee.

Appeal from the United States District Court for the Central District of California Dale S. Fischer, District Judge, Presiding

Submitted October 19, 2021** Pasadena, California

Before: CALLAHAN, OWENS, and FORREST, Circuit Judges.

Plaintiffs Ricky Ray, Morgan Howard, Alexis Grimm, Kourtnee Grimm, and

J.R. (collectively, the “Ray Family”) appeal from the district court’s summary

judgment in favor of defendant State Farm Mutual Automobile Insurance

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). Company (“State Farm”) in the Ray Family’s action arising from a car accident

where Cynthia Ray, wife and mother of the Ray Family, was killed. State Farm

insured the driver who caused the accident. After an underlying personal injury

suit against the driver awarded damages to the Ray Family, the driver assigned his

contractual rights against State Farm to the Ray Family. The Ray Family then filed

the instant action against State Farm, asserting a single claim under California law

for breach of the covenant of good faith and fair dealing. Specifically, the Ray

Family alleged that State Farm acted in bad faith by failing to accept a policy-

limits demand to settle the Ray Family’s claims against the driver.

We review de novo a district court’s grant of summary judgment. SEC v.

Stein, 906 F.3d 823, 828 (9th Cir. 2018). “A district court’s refusal to continue a

hearing on summary judgment pending further discovery is reviewed for an abuse

of discretion.” Id. at 833 (citation omitted). The denial of leave to amend is also

reviewed for an abuse of discretion. Branch Banking & Tr. Co. v. D.M.S.I., LLC,

871 F.3d 751, 760 (9th Cir. 2017). We affirm.

The district court did not abuse its discretion by denying the Ray Family’s

request under Federal Rule of Civil Procedure 56(d) to continue summary

judgment so that the Ray Family could pursue additional discovery. The Ray

Family failed to identify why the specific facts and discovery it sought would

preclude summary judgment. See InteliClear, LLC v. ETC Glob. Holdings, Inc.,

2 978 F.3d 653, 662 (9th Cir. 2020) (setting forth the requirements to prevail on a

request for additional discovery under Rule 56(d)). The Ray Family also failed to

adequately explain why it could not have pursued its sought discovery earlier. See

Big Lagoon Rancheria v. California, 789 F.3d 947, 955 (9th Cir. 2015) (stating

that the party requesting a continuance must show that it “diligently pursued its

previous discovery opportunities” (citation omitted)).

The Ray Family further argues that “the district court erred in failing to

consider the additional material issues raised in opposition to the motion [for

summary judgment] as if they had been alleged in an amended complaint for bad

faith conduct for” (1) depleting the policy by settling with a third party also injured

in the car accident; (2) failing to disclose that another individual was also an

insured; and (3) failing to interplead the policy in the underlying personal injury

suit. The Ray Family raised these new theories regarding State Farm’s alleged bad

faith for the first time in its opposition to summary judgment, and did not explicitly

seek leave to amend its complaint.

It was improper for the Ray Family to advance these new theories for the

first time in its opposition to summary judgment. See Navajo Nation v. U.S. Forest

Serv., 535 F.3d 1058, 1080 (9th Cir. 2008) (en banc) (“[S]ummary judgment is not

a procedural second chance to flesh out inadequate pleadings.” (quoting Wasco

Prods., Inc. v. Southwall Techs., Inc., 435 F.3d 989, 992 (9th Cir. 2006))); Echlin

3 v. PeaceHealth, 887 F.3d 967, 978 (9th Cir. 2018). But see Desertrain v. City of

Los Angeles, 754 F.3d 1147, 1154 (9th Cir. 2014) (holding that the district court

should have construed matter raised by the plaintiffs in their motion for summary

judgment and their opposition to summary judgment as a request to amend the

complaint).

Moreover, even if raising these new theories was not procedurally improper,

the Ray Family fails to show that its new theories created a genuine dispute of

material fact regarding its pled claim that State Farm acted in bad faith by failing to

accept the policy-limits settlement demand.

Furthermore, to the extent that the district court implicitly denied the Ray

Family leave to amend to add its new theories, see Crowley v. Bannister, 734 F.3d

967, 977 (9th Cir. 2013), there was no abuse of discretion. Any amendment to add

the Ray Family’s new theories would have been futile, and the Ray Family does

not adequately explain its delay in raising these new theories. See United States v.

Corinthian Colls., 655 F.3d 984, 995 (9th Cir. 2011) (setting forth factors in

assessing the propriety of leave to amend).

AFFIRMED.